Some of the highlights for individuals include extending the TCJA would keep seven ordinary tax brackets with TCJA thresholds and rates. The top rate would be kept at 37% (versus 39.6% pre-TCJA) and the exemption and phase-out threshold from the Alternative Minimum Tax (AMT) would remain elevated. The standard deduction would remain roughly twice as high as before the TCJA and personal exemptions would remain eliminated.

The plan would also eliminate taxes on Social Security benefits. Under current law, individuals drawing Social Security benefits are required to pay taxes on 50%-85% of their benefits, with lower-income retirees paying taxes on a lower share than higher-income retirees. This proposal would exclude all Social Security benefits from taxable income for all individuals.

On the business side, the plan would extend the business tax provisions of TCJA. Lawmakers made several changes to the tax treatment of business investment in the 2017 TCJA, creating a tax system that was more generous to businesses in the years immediately following the law’s enactment but became less generous over time.

Initially, businesses could immediately deduct from their taxable income 100% of most tangible investment costs—known as “bonus” depreciation—and 100% of expenditures for research and experimentation (R&E). This change was partly offset by a new limitation on deductions for interest expenses. In the years since, the bonus depreciation percentage has dropped 20 percentage points per year (falling to zero in 2027). The proposal would restore and make permanent the regime that existed immediately after TCJA’s enactment.

On the tariff side, the President-elect has stated that he will impose across the board tariffs of either 10% or 20% on every import coming into the US, as well as a tariff upward of 60% on all Chinese imports. He’s also floated a 100% or 200% tariff on cars made in Mexico or on the products made by companies that move manufacturing from the US to Mexico. The President-elect’s plan claims that tariffs will boost American manufacturing, create jobs and bring in billions of dollars to help pay for other policy initiatives.

An important component of the President-elect’s plan includes the creation of a new agency to eliminate excess government spending and reduce waste. Elon Musk, owner of SpaceX and Vivek Ramaswamy, a biotech founder, have been tapped to lead a new Department of Government Efficiency (DOGE) designed to begin that process. They have revealed plans to reduce federal regulations and reduce the federal workforce through restructuring and attrition.

Although it is very early, priorities include an effort to immediately end remote work across federal agencies, making a five-day work week a requirement for all federal employees. In a Wall Street Journal opinion piece published on Nov. 20, Mr. Musk and Mr. Ramaswamy said they and “a lean team of small-government crusaders” embedded at federal agencies will review regulations to identify ones they deem invalid.

According to the opinion piece, a pair of recent U.S. Supreme Court decisions that placed significant limits on agencies’ rulemaking powers will guide the review. In a 2022 decision, the Supreme Court ruled that agencies couldn’t address “major questions” with broad economic or societal impact without explicit permission from Congress. And in a landmark June 2024 ruling, the court overturned its own precedent and said courts no longer were required to defer to an agency’s interpretation of an ambiguous law.

Mr. Musk and Mr. Ramaswamy said their review would focus on regulations that are invalid in light of those decisions, which were seen as major victories in a campaign by conservative groups to rein in the “administrative state.” However, the Supreme Court’s holdings in those cases were nuanced, and it may take years for courts to sort out how they apply to individual regulations.

DOGE will present its findings to the President, who could issue executive orders immediately pausing enforcement of specific rules and directing agencies to repeal them, according to the op-ed. Federal regulations impact every facet of American society, from education, healthcare, and immigration to environmental pollution, drug safety, tax policy and labor rights.

Mr. Musk and Mr. Ramaswamy said DOGE would also recommend layoffs across federal agencies and identify billions of dollars in government spending that is invalid because Congress did not authorize it. They said they are aiming to complete the panel’s work by July 4, 2026, the 250^th anniversary of the country’s founding.

About the author: Michael J. Paton is a portfolio manager at Tocqueville Asset Management L.P. He can be reached at 212-698-0800 or by email at [email protected].